Pressing auto-destruct

Sunday

Nov 10, 2013 at 6:00 AM

It has been well over three years since passage of the Affordable Care Act, and headaches continue to attend almost every piece of the law as it takes effect. Supporters continue to insist that opposition to Obamacare is to blame for its problems, and accuse some, notably House Republicans, of wanting to see the legislation fail.

But as a practical matter, we're beginning to think that the law's supporters are the ones pushing it toward failure.

We have repeatedly warned that, regardless of ideology, the underpinnings of Obamacare were suspect, at best, placing wishful thinking and political preferences ahead of economic principles and well-established norms of human behavior.

Younger, healthier workers, for example, have little incentive to sign up for government-run insurance exchanges whose products they either do not want or do not expect to need, when the penalty for not joining is far lower than the premiums they will pay if they do sign up.

That's not hard to understand, but it seems not to have occurred to the architects of Obamacare, whose government exchanges rely upon enrolling enough healthier, younger people to support the costs associated with relatively older, sicker enrollees.

No one could have been surprised when the early returns for enrollee data — from Connecticut and Kentucky, Ohio, Michigan and Wisconsin — showed a pool significantly older than anticipated.

Those numbers may change as the issues with HealthCare.gov are improved, but we wouldn't bet on it. And given that older people go to the doctor more often and cost more, an older poll will mean higher costs passed along to everyone, including the payer of last resort — the American taxpayer.

Cost pressures are likely to be exacerbated as well by another broad characteristic of Mr. Obama's reform law — its penchant for granting waivers and exemptions, and carving out special rules and favors for particular groups.

Recall that on Oct. 30 in Boston, Mr. Obama derided "bad apple" insurers and the "sub-standard" plans they offered prior to the arrival of the new law's mandates for coverage.

But last week, faced with undeniable evidence that millions of Americans are losing individual health plans as of Dec. 31, Obama administration officials met with California health officials, who then leaned on insurance providers to extend those very kinds of policies.

So government is perfectly willing to have private insurers extend "substandard"coverage if it can paper over the devastating impact Obamacare is having on the individual policy marketplace.

Second, the administration has continued to offer exemptions and opt-outs to favored groups, thereby undermining the economics of its own law.

The administration recently issued a final rule governing a reinsurance fee buried in those thousands of pages of Obamacare. That fee of $63 per person is supposed to raise $25 billion over three years.

But the final version of the rule grants an exemption to "certain self-insured, self-administered" plans, including those run by some of the nation's largest unions, who won't have to pay the fee in 2015 and 2016.

In this nation, all are supposed to be subject to the law. It is clear that is not the case with Obamacare, whose labyrinth of complex provisions, Byzantine restrictions, special exemptions, and overall clunky functionality are beginning to remind us of Kelley Square during rush hour on the day before Thanksgiving.

But a law that barely works in theory will quickly fall to pieces if the very people responsible for implementing it continue to make it next to impossible for Americans to have confidence in its functionality or fairness.